Insurance means the undertaking by one person to indemnify another person against loss or liability for loss in respect of a certain risk or peril to which the object of the insurance is exposed, or to pay a sum of money or other thing of value upon the happening of a certain event. (Ontario Insurance Act)

An agreement between the owner trustee and the indenture trustee: The owner trustee mortgages the equipment and assigns the lease and rental payments under the lease as security for amounts due to the lenders. Same as security agreement or mortgage. (U.S. Equipment Leasing Association)

These contractual provisions essentially require that the lessee perform its obligations under the lease without right of setoff, deduction, abatement, compensation or counter-claim for any reason whatsoever. For the lessor, the purpose is to ensure that it will invariably receive its monthly rental payment. (Gowling Lafleur Henderson LLP, Montréal)

Accounting practices which have been codified in the (Canadian Institute of Chartered Accountants) CICA Handbook, or which are in common usage. (Leasing in Canada [Third Edition], Ralph Selby, FCA, Butterworths, 1999)

A national value-added tax imposed on taxable supply of goods and services provided in Canada. Supply is defined to include sale, transfer, barter, exchange, licence, rental, lease, gift or disposition. (PricewaterhouseCoopers LLP)

A lease in which the total of the lease payments pays back to the lessor the entire cost of the leased property including financing, overhead and a reasonable rate of return, with little or no dependence on a residual value. (Blakes Cassels & Graydon LLP)

[see also Bargain Purchase Option, Bargain Renewal Option, Fair Market Purchase Option, and Purchase Option]

An option given to the lessee to purchase the leased property from the lessor on the option date for a guaranteed price, determined at the inception at the lease. (Blakes Cassels & Graydon LLP)

[See Capital Lease; compare Operating Lease]

Typically, a finance lease is a full-payout, non-cancellable agreement, in which the lessee is responsible for maintenance, taxes, and insurance. (U.S. Equipment Leasing Association)

The price for which the leased property could be sold in an arms’s length transaction (usually normal the selling price if manufacturer or dealer or the cost to the lessor). (KPMG LLP)

The amount that a “reasonable person” would pay in a competitive market. (Leasing in Canada [Third Edition], Ralph Selby, FCA, Butterworths, 1999)